First, I'll confess I'm no expert, but I had the same problem.  It caused me some confusion until I figured that it was telling me there wasn't enough space in the destination  (or "target") for the ISO.  If you go through the Shrink process again, you'll be asked to select a destination for the ISO Read.  Then you will see a window that tells you how much space is available and how much your "burn" will need.  As I had designated "C" for my target, I clicked on "My Computer" and when it came up, I right clicked on the icon.  I could then see available space. As I already knew how much it would take for my burn, I could tell if it would work or not.  At this point, you can select another target, or (as in my case) delete some  files from "C."  When available space exceeds the space needed for your burn, it should work o.k.